Electronic Retailer - February 2012 - 42

WHAT YOUR CONSUMER SAYS ABOUT YOU MATTERS

blog posts. It also provides short URLs to include in tweets. Not surprisingly, some of the most useful guidance has been provided by the FTC itself through its announcements of several high-profile investigations in new media. The findings and conclusions in these matters have certainly become part of the legal vernacular for practitioners in the industry. One of the earliest investigation involved advertising for clothing manufacturer Ann Taylor. The retailer had invited bloggers to preview its Loft division’s summer 2010 collection, offering a “special gift” and promising that those posting coverage from the event would be entered into a “mystery gift card drawing” in which they could win between $50 and $500. The invite explained that bloggers must submit posts to the company within 24 hours in order to find out the value of their gift card. The FTC was concerned that the marketer failed to disclose that the bloggers received gifts for posting content about the event. Although the agency decided not to take action against Ann Taylor, the warning flare to marketers had been fired that the FTC has its antenna up regarding issues of material disclosure online.

Perhaps the FTC case that resonated most loudly in the industry in 2011 involved advertising for Legacy Learning Systems. Legacy Learning advertised its Learn and Master Guitar DVD series by recruiting “review ad” affiliates to promote the product through “articles, blog posts and other online editorial material, with the endorsements appearing close to hyperlinks to Legacy’s website.” These affiliates received “substantial commissions,” which they did not disclose, for each sale resulting from referrals and generated more than $5 million in sales of Legacy’s courses, according to the FTC. The company agreed to pay $250,000 to settle charges with the Commission. Regulatory agencies are not the only ones keeping an eye on how companies are utilizing social media to promote products and services. Self-regulatory programs such as the Electronic Retailing Self-Regulation Program (ERSP) and the National Advertising Division of the Council of Better Business Inc. (NAD) have brought forth inquiries involving the disclosure of material information in social media. More recently, in late 2011, NAD reviewed advertising for Coastal Contacts. A competitor of the advertiser contended that Coastal Contacts

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had deceptively offered free and discounted products to Facebook users who “liked” the company’s page, and that the number of “likes” presented to investors through press releases had been fraudulently obtained. NAD determined that the display of the total number of “likes” on Coastal’s Facebook page conveyed a general social endorsement. Because actual consumers “liked” the Coastal page, and those consumers who participated in the promotion received the benefit of the promotion, NAD determined that Coastal does, in fact, have the general social endorsement that the “likes” convey. It is clear that uncertainty regarding the use of consumer representations on websites and other social networking forums are not going away soon. In fact, as more marketers use consumer endorsements to promote products through social media, it’s inevitable that new issues such as “like-gating” in the Coastal Contacts case will continue to arise. Often, self-regulation forums such as ERSP and NAD are on the front line with respect to resolving and explaining such issues. As Engle notes, “ERSP and NAD have the advantage of being able to respond more quickly to trends in marketing and advertising than the government sometimes can.” One last thing to note is that unlike in other traditional marketing venues, brand promotion may very well be occurring within social media without marketers’ knowledge, and people are discussing brands to third parties unbeknownst to the advertisers. While there is continuing uncertainty about an advertiser’s responsibility for third-party content, the bottom line is that marketers want to – and should be – tracking what is being said about their brands on social media in order to manage and maintain the brand integrity they’ve worked so hard to establish. Peter Marinello is director of the Electronic Retailing Self-Regulatory Program (ERSP). He can be reached at (212) 705-0126 or via email at pmarinello@narc.bbb.org.

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Electronic Retailer - February 2012

Table of Contents for the Digital Edition of Electronic Retailer - February 2012

Calendar of Events - Upcoming Industry Events February through May
Your Association, Your Bottom Line
Industry Reports - Connect, Collaborate and Discover with MyERA
FTC Forum - Where the FTC Says Facebook Went Wrong
eMarketer Research - Who is the U.S. Hispanic Market?
IMS Retail Rankings - The Top 25 Shows and Spots
Jordan Whitney’s Top Categories - The Top 5 Shows and Spots and the Top 3 Categories
Lockard & Wechsler’s Clearance & Price Index - Index for 30, 60 and 120 Seconds
Ask the Expert - Who Says Kids’ Products Don’t Sell on DRTV?
From the Executive’s Desk - Create the Complete Package
DR Disruption
Bienvenido a Miami!
Interactive TV: Just a Click Away
What Your Consumer Says About You Matters
Guest Viewpoint - For Hispanic Vote, the Campaign is On
Guest Viewpoint - Own Your Own Online Media
DRTV - Supporting Retail: Is This the Answer?
Fulfillment - Are You Delivering a Great Customer Experience?
Teleservices - Stop Losing Thousands of Leads
Member Spotlight
Advertiser Spotlight - Highlighting This Month’s Advertisers
Bulletin Board - DG and Discovery Launch Digital Distribution System
Advertiser Index
Classifieds
Rick Petry - MINI Me
Electronic Retailer - February 2012 - cover1
Electronic Retailer - February 2012 - cover2
Electronic Retailer - February 2012 - 3
Electronic Retailer - February 2012 - 4
Electronic Retailer - February 2012 - 5
Electronic Retailer - February 2012 - 6
Electronic Retailer - February 2012 - Calendar of Events - Upcoming Industry Events February through May
Electronic Retailer - February 2012 - Your Association, Your Bottom Line
Electronic Retailer - February 2012 - 9
Electronic Retailer - February 2012 - 10
Electronic Retailer - February 2012 - Industry Reports - Connect, Collaborate and Discover with MyERA
Electronic Retailer - February 2012 - 12
Electronic Retailer - February 2012 - 13
Electronic Retailer - February 2012 - FTC Forum - Where the FTC Says Facebook Went Wrong
Electronic Retailer - February 2012 - 15
Electronic Retailer - February 2012 - eMarketer Research - Who is the U.S. Hispanic Market?
Electronic Retailer - February 2012 - 17
Electronic Retailer - February 2012 - IMS Retail Rankings - The Top 25 Shows and Spots
Electronic Retailer - February 2012 - 19
Electronic Retailer - February 2012 - Jordan Whitney’s Top Categories - The Top 5 Shows and Spots and the Top 3 Categories
Electronic Retailer - February 2012 - 21
Electronic Retailer - February 2012 - Lockard & Wechsler’s Clearance & Price Index - Index for 30, 60 and 120 Seconds
Electronic Retailer - February 2012 - 23
Electronic Retailer - February 2012 - Ask the Expert - Who Says Kids’ Products Don’t Sell on DRTV?
Electronic Retailer - February 2012 - 25
Electronic Retailer - February 2012 - From the Executive’s Desk - Create the Complete Package
Electronic Retailer - February 2012 - 27
Electronic Retailer - February 2012 - DR Disruption
Electronic Retailer - February 2012 - 29
Electronic Retailer - February 2012 - 30
Electronic Retailer - February 2012 - 31
Electronic Retailer - February 2012 - Bienvenido a Miami!
Electronic Retailer - February 2012 - 33
Electronic Retailer - February 2012 - 34
Electronic Retailer - February 2012 - 35
Electronic Retailer - February 2012 - Interactive TV: Just a Click Away
Electronic Retailer - February 2012 - 37
Electronic Retailer - February 2012 - 38
Electronic Retailer - February 2012 - 39
Electronic Retailer - February 2012 - What Your Consumer Says About You Matters
Electronic Retailer - February 2012 - 41
Electronic Retailer - February 2012 - 42
Electronic Retailer - February 2012 - 43
Electronic Retailer - February 2012 - Guest Viewpoint - For Hispanic Vote, the Campaign is On
Electronic Retailer - February 2012 - 45
Electronic Retailer - February 2012 - Guest Viewpoint - Own Your Own Online Media
Electronic Retailer - February 2012 - 47
Electronic Retailer - February 2012 - 48
Electronic Retailer - February 2012 - DRTV - Supporting Retail: Is This the Answer?
Electronic Retailer - February 2012 - Fulfillment - Are You Delivering a Great Customer Experience?
Electronic Retailer - February 2012 - Teleservices - Stop Losing Thousands of Leads
Electronic Retailer - February 2012 - Member Spotlight
Electronic Retailer - February 2012 - 53
Electronic Retailer - February 2012 - Advertiser Spotlight - Highlighting This Month’s Advertisers
Electronic Retailer - February 2012 - Advertiser Index
Electronic Retailer - February 2012 - Classifieds
Electronic Retailer - February 2012 - 57
Electronic Retailer - February 2012 - Rick Petry - MINI Me
Electronic Retailer - February 2012 - cover3
Electronic Retailer - February 2012 - cover4
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